European stocks retreated, following their biggest weekly gain in a month, as China’s economy grew at a slower pace than estimated and a gauge of manufacturing in the New York area missed forecasts. In London the UK’s FTSE 100 shed 41 points (-0.6%) to settle at 6344, whilst the German DAX lost 32 points (-0.4%) to close at 7713.
Stateside, the Standard & Poor’s 500 Index recorded its biggest drop of the year as a gauge of market volatility jumped the most in 20 months. The S&P 500 dropped 2.3% to 1,552 in New York, the biggest decline since 7 November. The index has lost 2.6% since 11 April.
The Dow Jones Industrial Average erased 266 points (-1.8%) to 14,599. Commodities fell to a nine-month low, led by the worst plunge in gold since 1980.
Gold plunged the most in 33 years amid record-high trading as an unexpected slowdown in China’s economic expansion sparked a commodity selloff from investors concerned that more cash will be needed to cover positions. Gold futures for June delivery slumped 9.3% to close at $1,361.10 on the Comex in New York.
Crude fell to the lowest level this year as China’s economic growth unexpectedly eased, raising concern that demand from the world’s second-biggest oil-consuming country will slow. Oil for May delivery decreased $2.58 (-2.8%) to settle at $88.71 a barrel on the NYMEX, the lowest settlement since 24 December.
The yen held gains from yesterday against most of its major counterparts as bomb blasts in Boston and slowing growth in China fuelled demand for haven assets. Today’s session will bring us data in the form of the latest RBA Monetary Policy Meeting Minutes and new motor vehicle sales, at 11:30am, AEST.